The Democrats’ Abundance Problem
Voters Aren’t Convinced They Can Deliver It
Last week, I started revisiting my “Three Point Plan to Fix the Democrats and Their Coalition” from last October. A brisk tour of the polling and political data suggested the Democrats are still in need of serious reform and that the three point plan is as relevant as ever. Here’s the very short version of the plan:
1. Democrats Must Move to the Center on Cultural Issues
2. Democrats Must Promote an Abundance Agenda
3. Democrats Must Embrace Patriotism and Liberal Nationalism
Last week I discussed cultural issues. This week I’ll discuss abundance and conclude next week with patriotism.
The Abundance Problem
Abundance means just what you think it means: more stuff, more growth, more opportunity, being able to easily afford life’s necessities with a lot left over. In short, nicer, genuinely comfortable lives for all.
That’s what voters, especially working-class voters, want. But that’s not what they have. Recent Echelon Insights data show more voters think owning a home in a safe neighborhood with good schools is “out of reach” for the average American family (47 percent) than believe that is “financially within reach” (41 percent). That net negative score of 6 points is matched by views on the feasibility of caring for an elderly family member. And views are even more negative on whether starting a small business in financially within reach (-14), saving up for retirement excluding Social Security (-21), sending a child to college (-28), dealing with a major illness (-33) and raising a child on one parent’s income (-34).
Other Echelon Insights data find just 35 percent of working-class (non-college) voters saying they “can comfortably afford” paying their mortgage or rent on their current household income “without having to cut back in other areas”. Only 30 percent of these voters say they can comfortably afford medical and prescription drug costs; on child care it is 4 percent; on a vacation, 20 percent; on going out to eat, 37 percent; on insurance, 29 percent; on transportation, 34 percent; on new clothes, 29 percent; on saving for retirement, 15 percent; and on placing money in an emergency fund, 21 percent.
Whatever that is, it ain’t abundance. Of course, some of this has to do with the baleful effects of high inflation. Over the last two years, workers’ wages have actually lost ground relative to inflation. This is particularly true for workers in the middle of the income distribution. Compared to a year ago, prices are up 28 percent for fuel oil, 27 percent for utility gas, 15 percent for transportation, 12 percent for electricity and 11 percent for groceries. While overall inflation has abated relative to the middle of last year, it clearly remains a large presence in workers’ lives.
In light of all this it is unsurprising that voters’ views on the economy and the effects of Biden administration policies are distinctly negative. In a recent CBS News poll 53 percent said Biden’s policies have made the economy worse, compared to 27 percent who say his policies have made it better. The analogous figures on “your own family’s finances” are 49 percent vs. 18 percent; on inflation, 57 percent vs. 22 percent; and on gas prices, 55 percent vs. 21 percent.
Recent Gallup data found half in the country saying they are financially worse off today than they were a year ago, the highest level since 2009 in the midst of the Great Recession. Among the working class, the level saying they are worse off than a year ago is even higher.
Recent Washington Post/ABC News data further document the depth of working-class discontent. In the poll, 41 percent of the public say they are worse off today than they were when Biden took office, the highest level the poll has recorded on analogous questions dating back 37 years. But the negative judgement is even higher among working-class respondents at 44 percent to a mere 14 percent who say they are better off.
Whew. That seems pretty far from abundance. But these are the facts on the ground, as it were. What do the Democrats propose to do to change these facts? One part of their approach is a messaging tsunami. The idea is for Biden and administration surrogates to fan out across the country to give voters the good news about the investments in their three big bills (the bipartisan infrastructure bill, the CHIPS and Science Act and the so-called Inflation Reduction Act (IRA)) and how they are bringing/will bring prosperity and good jobs to their communities.
However…..from a Washington Post article: “Biden touts his successes, but few voters know about them”:
President Biden stood in front of hard-hat-wearing union members [in Madison, Wisconsin] on Wednesday and ticked off the federally funded benefits that would soon reach the region: a new terminal at the Port of Green Bay that’s “going to create thousands of jobs over time,” a replacement of the aging Wisconsin River Bridge, 46 electric buses that will replace “dirty diesel buses” on Madison streets.
But a few miles away, Christine Elholm, a Democrat who voted for Biden and would love to tout his successes to her more skeptical friends, struggled to identify any of these projects or how they will improve her community. She regularly watches MSNBC and the local evening news and she scrolls through headlines on The Washington Post to stay informed, but, she said, “I have to admit, I’m not in tune to how some of these policies are affecting our city yet.”….
The president has been hopscotching the country for weeks to argue that his bills are tackling communities’ long-festering problems, from a tunnel in Baltimore (“For years, people talked about fixing this tunnel”) to a bridge in Kentucky (“They’ve been fighting this for years, to get the funding to repair the bridge”).
The events at times resemble a mayor’s appearance at a ribbon-cutting. But Biden’s message — that his hard-earned laws are helping local families in tangible ways — has not clearly broken through.
On Wednesday, Biden spoke at a training center outside Madison, addressing a crowd that could be measured in dozens. On a short set of bleachers with a capacity for at least 60 people, a group of fewer than 24 union workers and apprentices stood behind him, forming a sparse backdrop of orange shirts, brightly colored vests and white hard hats. There were often large gaps between each person.
This suggests that the administration’s problems getting through to voters may be less messaging than facts on the ground. If communities are really thriving due to new projects and investments, they usually know it. Of course, it’s possible that at some point in the next two years enough concrete change may have happened that voters will give Democrats the credit they are seeking and the economic ratings mentioned above will get much, much better. But without that visible, widely-appreciated concrete change, they won’t.
Realistic Democrats understand this. They know that messaging is not enough. They are hoping that the spending from their big bills triggers an investment surge, resulting in boom conditions that wipe out the memory of the last two years — something like the “morning in America” scenario of Reagan’s 1984 campaign.
But will it? So far, as economist Noah Smith has noted,
The U.S. is clearly not experiencing any kind of a revival in either private or government investment. The employment boom is due to increased consumption and exports, not to businesses or the government buying new capital.
And it might not in the future. Smith says it is possible that:
[M]any of the investments [from the administration’s bills] won’t actually be made at all — or not within a reasonable time frame. For example, the grid interconnection queue was already filled up with renewable energy projects by the end of 2021, but these haven’t been getting actually built, since U.S. law and administrative and regulatory systems are very effective at preventing development at the local level…
In addition to delay, there’s the issue of America’s ruinously high construction costs. Transit projects, including both roads and trains, cost much more in the U.S. than in other countries, and these costs have exploded in recent decades. Costs feed into delays, and delays feed into costs. This is just as true for the private sector; unsurprisingly, the TSMC [Taiwanese Semiconductor Manufacturing Company] factory that Biden is trumpeting in the U.S. is hitting major delays because navigating local rules is proving more expensive than expected. Of course, factories and roads and trains and power lines that never get built don’t actually boost labor demand, because the workers don’t get hired….
If Biden really wants to boost investment, both at the government and private level, he needs to tackle this basic problem, not just spend more money. Barriers to the development of infrastructure, clean energy, and factories must be rooted out not just at the federal government, but at every level of government. To use a phrase that’s trendy these days, we need a “whole-of-government approach” to battering down project delays and excess costs. If we do not do that, all of the investment numbers Biden and his people cite will be just that — numbers on a sheet of paper.
In short, it’s just too damn hard to build stuff. The Democrats don’t seem too interested in changing this situation — for example, the modest permitting reforms that Joe Manchin was promised as a condition for his support on the IRA died partially because of lack of support from his own party. But without changing that situation, it’s quite unlikely Democrats can deliver the abundance voters, particularly working-class voters, are looking for. Making it a bit easier for consumers to buy an electric car or a heat pump just isn’t going to cut it.
It’s worth dwelling for a moment on the death of Manchin’s permitting reform and its implications. As has been widely noted, if the IRA’s investments are to actually reduce carbon emissions to the extent the administration and advocates claim, it would depend on an absolutely massive build-out of infrastructure, especially interregional high voltage transmission lines, which will be quite difficult. As noted, it’s very hard to build such things fast in the United States, given permitting and regulatory obstacles. Even with the permitting reform bill, the pace at which this infrastructure could plausibly have been built was likely far below what would be needed to hit administration timetables. Without permitting reform, the pace will be truly glacial.
And it’s not just renewable energy infrastructure that will suffer. There is now a renaissance in nuclear energy — theoretically supported by the IRA — throughout the world, as country after country reverses course and embraces the necessity of a nuclear buildout: the Czech Republic, Netherlands, Poland, South Korea, the UK and even Japan, which had anathematized nuclear after the 2011 Fukushima incident. But the US will be hard-pressed to participate in this renaissance without regulatory changes that would facilitate the building of new reactors. Instead, the Nuclear Regulatory Commission released a draft of new rules in September, 2022 that would make it harder, not easier, to build them.
Yet without adequate infrastructure and firm power supply from nuclear or fossil fuels, the rapid build-out of wind and solar the Biden administration and climate advocates want is highly unlikely to work the way they envision. But it will stress the grid and likely anger consumers and industry through rising prices and declining reliability.
Again, none of this is a recipe for abundance. Democrats seriously need to rethink their approach and not assume that simply spending more money in their favorite areas (like climate change) is going to do the job.